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The average monthly mortgage payment including principal and interest is $982 in the United States. If the standard deviation is approximately 5180 and the mortgage payments are approximately normally distributed, find the probability that a randomly selected moathly payment is

a) more that $1000
180/1000−982 =0.11−0.5398=0.4602​
b) between $800 and $1100 800-198/180 = -1.01 1100-982/180 = 0.105
c) If a sample of 30 mortgages payments is selected, find the probability that the sample mean will be between $950 and $1050.

User Erol
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1 Answer

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Final answer:

The probability that a randomly selected monthly payment is more than $1000 is approximately 0.5014. The probability of a monthly payment between $800 and $1100 is approximately 0.0260. The probability that the sample mean of 30 mortgage payments is between $950 and $1050 is approximately 0.

Step-by-step explanation:

To find the probability that a randomly selected monthly payment is more than $1000, we need to standardize the value using the formula z = (x - μ) / σ, where x is the value, μ is the mean, and σ is the standard deviation. Plugging in the values, we have z = (1000 - 982) / 5180 = 0.0035. Using a standard normal distribution table, we can find that the probability is approximately 0.5014.

For the probability of a monthly payment between $800 and $1100, we need to standardize the values of $800 and $1100. Using the formula, we find that z1 = (800 - 982) / 5180 = -0.035 and z2 = (1100 - 982) / 5180 = 0.035. Again, using the standard normal distribution table, we can find that the probability is approximately 0.5138 minus 0.4878 = 0.0260.

To find the probability that the sample mean of 30 mortgage payments is between $950 and $1050, we need to standardize the values of $950 and $1050 and use the formula z = (x - μ) / (σ / sqrt(n)), where n is the sample size. Plugging in the values, we have z1 = (950 - 982) / (5180 / sqrt(30)) = -0.28 and z2 = (1050 - 982) / (5180 / sqrt(30)) = 0.28. Using the standard normal distribution table, we can find that the probability is approximately 0.39 minus 0.39 = 0.

User Graham Whitehouse
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